define intermediate municipal bond.
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Municipal bond A municipal bond is a bond issued by a local government or territory, or one of their agencies. It is generally used to finance public projects such as roads, schools, airports and seaports, and infrastructure-related repairs. The term municipal bond is commonly used in the United States, which has the largest market of such trade-able securities in the world. As of 2011, the municipal bond market was valued at was at $3.7 trillion.
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- The indenture is a. contract between the issuer of the bonds and a banking institution that acts as trustee for the. benefit of the holders of the bonds from time to time. High-yield bonds are most commonly sold. to investors by the issuer through investment banks, or underwriters, in an offering that is.
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How Municipal Bonds Work Municipal bonds are one of the safest long-term investments. Because they're so secure, they usually carry interest rates that average a percentage point or two below the going rate for Treasury bills.
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About Municipal Bonds Even though the interest paid on a municipal bond is tax-exempt, a holder can recognize gain or loss that is subject to federal income tax on the sale of such a bond, just as in the case of a taxable bond. The amount of gain or loss is equal to the difference between. the sale price of the bond and.
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Non-Dominant Interexchange Bond Non-Dominant Interexchange Bond Section 1013 of the public utility code in California requires that insured exchange telephone carriers be registered, pay a registration user fee, and provide a bond of $25,000 or 10% of the intrastate revenues reported by the registrant, whichever is greater.
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Corporate Bonds vs. Municipal Bonds As is the case with corporate bonds, you can make money from municipal bonds by collecting regular interest payments. Unlike corporate bonds, however, those payments will never be subject to taxes at the federal level. Furthermore, if you buy bonds issued by your home state, you won't pay state or local taxes, either.
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- The municipal market is volatile and can be significantly affected by adverse tax, legislative or political changes and the financial condition of the issuers of municipal securities. Defined Maturity Funds are not designed for investors seeking a stable net value asset (NAV) or guaranteed income.
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About Municipal Bonds Under the de minimis rule, if a bond is purchased with a small amount of market discount—an amount less than 0.25 percent of the face value of a bond times the number of complete years between the bond’s acquisition date and its maturity date—the market discount is considered to be zero.
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About Municipal Bonds For instance, if an investor pays state tax at an effective 5% rate (after taking into account the federal deduction allowed for such state taxes) and the state taxes out-of-state bonds (but not in-state bonds), an in-state bond bearing a 6% interest rate is the equivalent of a 6.32% out-of-state bond.
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income bond Income Bond. A bond in which the issuer is only responsible for making coupon payments when it has sufficient income to do so. Income bonds are most common in reorganization plans in which the issuer is attempting to maintain operations in bankruptcy.An income bond is useful for the issuer because it provides capital quickly.ncome bonds are most common in reorganization plans in which the issuer is attempting to maintain operations in bankruptcy. An income bond is useful for the issuer because it provides capital quickly.
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What is a bond trade life-cycle? Here is some information on the Bond. Municipal bonds typically are brought to market through an underwriting process and may continue to be bought and sold in the secondary market through their maturity. Refer to the resources below for more information on the lifecycle of a typical bond.
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Short-Term Bond #1 in Short-Term Bond. The investment seeks to provide current income while maintaining limited price volatility. The fund invests in a variety of high-quality and, to a lesser extent, medium-quality fixed income securities, at least 80% of which will be short- and intermediate-term investment-grade securities.
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Are Municipal Bonds a Good Investment? The municipal bond market is now about $3.7 trillion, which is a little more than one-third the size of the Treasury market. But unlike Treasuries, which are held by investors all over the world — by both individuals and governments — municipal bonds are purchased primarily by U.S. households.
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How Bonds are Sold - Your Transaction Costs With respect to the secondary market, municipal bonds are traded over-the-counter. What this means is that municipal bonds are not traded on an exchange. When you buy or sell a bond, it is being sold or bought by a dealer. Compare this to a stock trade, when you place a sell order, the order simply gets routed to an exchange or market maker to get executed.
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Intermediate sanctions Intermediate sanctions is a term used in regulations enacted by the United States Internal Revenue Service that is applied to non-profit organizations who engage in transactions that inure to the benefit of a disqualified person within the organization.
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The Hidden Tax on Municipal Bond Income A: Municipal bonds can be a sweet deal for tax-conscious investors. That’s because interest income generated by these bonds — which are issued by states, cities and other public entities — is typically exempt from federal income tax.
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Glossary of Municipal Securities Terms Glossary of Municipal Securities Terms. Typically refers to a bond issued by a state or local government that is payable from general funds of the issuer, although the precise source and priority of payment for general obligation bonds may vary considerably from issuer to issuer depending on applicable state or local law.
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Glossary of Municipal Securities Terms Glossary of Municipal Securities Terms. With respect to an issue of bonds, the weighted period of time required to repay half of the issue through scheduled principal payments (e.g., maturity, sinking fund redemption, etc.).
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Do Municipal Bonds Have a Place in My Portfolio? To that end, calculating taxable-equivalent yield can help investors compare taxable and municipal-bond funds. In other words, the taxable-equivalent yield helps investors perform an apples-to-apples comparison by adjusting municipal-bond fund yields to a tax-equivalent level.
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municipal bond This priority of the tax lien is the foundation of the prime position of municipal bonds. How to Invest Money George Garr Henry. As a class they yield more than government or municipal bonds, and less than public-utility or industrial bonds. How to Invest Money George Garr Henry.
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- Arbitrage Bond. Share. DEFINITION of 'Arbitrage Bond'. A debt security with a lower interest rate issued by a municipality prior to the call date of the municipality's existing higher-rate security. Proceeds from the issuance of the lower-rate bonds are invested in treasuries until the call date of the higher-interest bonds.
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Municipal bond Because municipal bonds are most often tax-exempt, comparing the coupon rates of municipal bonds to corporate or other taxable bonds can be misleading. Taxes reduce the net income on taxable bonds, meaning that a tax-exempt municipal bond has a higher after-tax yield than a corporate bond with the same coupon rate.
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- Municipal Bond Funds. The Internal Revenue Service does not require investors who own most types of municipal bonds to pay taxes on bond interest payments. Likewise, shareholders of mutual funds containing municipal bonds typically do not have to pay interest on fund dividends. However, shareholders do have to pay capital gains tax if they sell shares for a price in excess of the original purchase price.
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- Municipal bonds, or munis, have proved to be a great vehicle for states and municipalities that can receive financing at a low cost, and for investors who can find better after-tax returns for their bond portfolios.